Dear ,
As requested, let’s look at EURUSD and the recent events that happened in the previous trading session.
EURUSD Analysis
| Performance after Tuesday | |||||
| Period | Pct | Chg | Momentum | ||
| Tuesday | -0.21% | -22.5 Pips |  |
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| Week to-date | -0.65% | -70.9 Pips | |
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| October | -3.04% | -338.9 Pips |  |
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Upcoming key events (London Time)
No major events for the day.
What happened lately
In Germany, new data from the Federal Statistical Office (Destatis) indicates a further decline in the Producer Prices Index (PPI) for September. The yearly PPI dropped to -1.4% from the previous month’s -0.8%, while the monthly PPI recorded a descent from 0.2% in August to -0.5% in September. This consecutive decline in producer prices reflects persistent deflationary pressures within the German economy. A decrease in PPI generally suggests weaker production demand and lower costs for manufacturers, potentially leading to reduced consumer prices if manufacturers choose to pass on these lower costs. Such trends might indicate broader economic challenges including potential slowdowns in industrial demand or supply chain adjustments.
The reported decrease in Germany’s PPI could contribute to the weakening of the Euro as it may signal an economic slowdown or indicate that producers are unable to maintain price levels, impacting overall economic health. On Tuesday, the EURUSD exchange rate fell by 0.21% to 1.07977, a response likely tied to Germany’s economic data release, indicating investor sentiment moving away from the Euro and possibly towards the US Dollar. A continuing downward trend in Germany’s PPI might further pressure the Euro, putting it at risk of depreciation against the Dollar. With Germany being a vital economic engine for the Eurozone, its economic performance can heavily influence the region’s economic outlook and, consequently, the Euro’s valuation. In absence of significant economic events, market attention may remain focused on these deflationary signs from Germany and assess their implications for the broader Eurozone economy and monetary policy decisions.
What can we expect from EURUSD today?
EURUSD on Tuesday dropped -0.21% to 1.07977. Price is below 9-Day EMA while Stochastic is falling.
Updated daily direction for EURUSD looks bearish as the pair posted lower in Tuesday trading session.
Looking ahead for the day, immediate support level is at S1 1.07806 with break below could see further selling pressure towards S2 at 1.07634. To the upside, with the current momentum bearish, we prefer to look at breakout of the recent daily high of 1.08381 as a potential indicator of buying interest. Failure to break the resistance level would continue to echo bearish sentiment. A close below 1.07922 would indicate selling pressure.
For the week to-date, take note that EURUSD is bearish as the pair posted lower by -0.65%.
Key levels to watch out:
| R3 | 1.08724 |
| R2 | 1.08552 |
| R1 | 1.08265 |
| Daily Pivot | 1.08093 |
| S1 | 1.07806 |
| S2 | 1.07634 |
| S3 | 1.07347 |
